General Motors has apparently placed Cobasys on their list of distressed suppliers, a move that could be very bad news for some of GM's hybrid programs. Cobasys is the battery company jointly owned by Energy Conversion Devices and Chevron Technology Ventures. Cobasys supplies the nickel metal hydride batteries used in GM's mild hybrid system in the Saturn Aura and Vue and the Chevy Malibu. They are also one of two supplier teams with development contracts to provide lithium ion battery packs for the PHEV Saturn Vue that was shown at the Detroit Auto Show. Cobasys is doing the pack integration for cells provided by A123 systems for that program.

Apparently Cobasys lost $76 million in 2007 and expects the amount to widen to $82 million this year. ECD and Chevron are apparently at odds about funding the battery supplier and coming up with a spending plan for this year. When GM declares a supplier distressed they start watching them much more closely and the chances of a supplier on that list winning new business are slim. GM's full-size hybrid trucks, such as the Tahoe/Yukon, utilize batteries produced by Panasonic while the plug-in lithium battery programs all use multiple suppliers, so they should be ok unless another supplier stumbles. GM has not announced the name of the supplier for the Vue Two-mode hybrid that is due to launch this fall.

[Source: The Car Connection]